Bracing for Brexit: French food companies fear cost of ‘no deal’
White smoke billows from a chimney at a sugar beet factory in northern France, where a tanker truck is filling up on the region’s “white gold.”
As the sugar beet harvesting season enters full swing, the Lillers plant of the world’s thirdbiggest sugar producer Tereos is a hive of activity, with trucks bearing consignments of sugar departing every hour for markets around Europe.
Many are headed to Britain through the nearby port of Calais, Tereos’ fifth biggest market, where it supplies sugar to United Biscuits as well as the Whitworths baking sugar brand.
But that custom, which is crucial for Tereos’ 14 French plants, could turn sour if, as remains a danger, Britain leaves the EU on Oct. 31 without a divorce deal, prompting the return of a hard border. Britain has set out plans to make 87 percent of its imports tariff-free in the event of a no-deal Brexit. But food producers on either side of the Channel are expected to feel the bite. Tereos says that the cost of its sugar to British clients could jump by 50 percent.
“Today, we’re looking at (import tariffs of) €150 per ton of sugar. Given that a ton of sugar is worth €400, when you factor in the extra cost of customs and logistics, we could reach additional costs of €200, or 50 percent,” Paul Jacquelin, Tereos’ business transformation manager, told AFP. “It’s very worrisome for our British clients who will suffer big (price) increases.”
The cooperative, which groups 12,000 French beet growers, also fears its shipments being held up by tailbacks caused by the return of border controls in Calais.
This week, French customs staged their third dress rehearsal for a no-deal Brexit in as many weeks, subjecting a selection of trucks traveling between Calais and the English port of Dover to simulated export and import checks. “I think we’re ready,” JeanMichel Thillier, deputy director of the French customs service, told AFP, pointing to new “smart border” technology aimed at easing traffic across the world’s busiest shipping route in the event of a return of a hard border. But a delay of even a day or two in Calais could jeopardize some of Tereos’ business, causing its glucose syrups to solidify and British biscuit-makers working on a just-in-time production basis to run out of sugar.
“We’re still hoping that a deal (between the EU and Britain will be found), or that the UK will unilaterally reduce all its import tariffs to zero,” Jacquelin said. Concern over Brexit is also palpable at Rungis Market south of Paris, the world’s biggest wholesale market for fresh produce.
Marie Rivenez, head of GRG, one of France’s biggest meat wholesalers, which imports 600 lambs each day from Britain, told AFP she had received “absolutely no information” about what kind of sanitary checks, if any, might apply after Brexit.